Hi, I have the UNO powered from an external LIPO battery and sending data to the PC through USB, its as simple as suggested. This kind of simplicity that makes Arduino a joy to work with.

I am making a point of connecting the external power first, I am assuming that if I was to connect USB First, that would initially supply power, as soon as external power becomes available some sort of switch would take place. As I am unaware how this is managed and any of impact it may have I am avoiding it.

On the board is a voltage comparator. It takes the USB voltage and a fraction of the external voltage, which ever is higher determines the output of the comparator. This is then fed to an FET to switch the appropriate voltage to the main board. I don't think there will be any issues doing this while the board is running.